Latin America Risk Report - 23 April 2020
Food insecurity becomes the next coronavirus-related concern
In this edition:
Hitting the coronavirus long plateau
Food security and Covid-19
Earlier this week I sent paying subscribers an analysis on Brazil’s political situation and comments on Argentina’s debt negotiations and Mexico’s economic situation.
I have now dropped the paywall on the Brazil piece so that everyone can read it. You can support this newsletter and get access to early and additional analysis by subscribing for $9 per month or $90 per year at https://boz.substack.com/subscribe
Hitting the coronavirus long plateau
Even the worst country in Latin America (Brazil) has done a significantly better job than the United States, Italy or Spain at bending the curve on deaths from coronavirus. The daily number of deaths from coronavirus has either leveled out or the growth has slowed down in most countries.
There are many reasons to believe the numbers of deaths from COVID-19 are undercounted in Latin America and in the United States. It will take months if not years to fully account for all the deaths that occurred. I still think this graph is a fair representation of the region doing better given the number of countries and cities that locked themselves down far earlier. Acting two weeks earlier delivers more gains than waiting until the crisis is more severe and then acting more strictly.
From exponential growth to the long plateau
Flattening the curve and ending exponential growth of both cases and deaths is critical for Latin America to successfully overcome the pandemic. Here is the bad news.
The experience of Italy, Spain and the US is that in the locations where the curve flattens, they hit a long plateau in which the numbers of new cases and deaths remains steady or decreases at a much slower rate than they increased originally.
Recent data in Asia shows that countries attempting to reopen their economies see a new growth in cases that must be halted.
Nearly every public health expert agrees that more testing is needed and nearly every country in Latin America is behind on testing and will have a difficult time increasing testing as they compete globally for supplies to do so.
Latin America must now deal with those three facts. While the numbers of cases, hospitalizations and deaths may stop increasing, they are likely to remain steady for weeks or months to come. As governments try to reopen economic sectors, they will likely see spikes in cases in those sectors.
At the same time, public support for long quarantines will wane and people will increase their demands for the economy to reopen. Many Latin American leaders that have done a good job with short term measures have failed to provide a vision for their long term plans. They may not meet the expectations of populations.
Food security and Covid-19
Last week I commented on how coronavirus is changing the risks of organized crime and protests. There have been several articles in the international media on the same subjects and I’ve linked to those in the extra long reading list section below.
Above: Image from the World Food Program’s Hunger Map
Another concern being discussed globally is the risk to food security. The World Food Program estimates that the number of people at risk of acute hunger will double this year to 130 million globally. That includes 18.5 million people in Latin America, with the most vulnerable countries in the hemisphere being Guatemala, Haiti and Venezuela. As tragic as the situation in those three countries is, there is also growing concern about urban hunger in nearly every metropolitan area of the region.
The food security risks overlap with the risks related to protests and organized crime. There are small but increasing outbursts of protests in cities where people who usually work in the informal sector are demanding assistance due to the economic slowdown. Food insecurity creates the potential for criminal groups to organize burglaries masked as looting events. Food offers a potential recruiting tool for criminal groups. In Mexico, criminal groups have also used the situation to hand out food as a form of aid, something that undermines the local and federal government’s legitimacy.
Corruption Corner
Guatemala - Eight health officials are accused of attempting to steal state funds related to the response to coronavirus. Two deputy health ministers were fired and there are calls for Minister of Health Hugo Monroy to resign. With the exit of CICIG, this investigation is the first big test for President Giammattei’s new national anti-corruption commission. Local activists remain pessimistic.
Reading list
AP - World Bank: Global remittances to drop 20% amid coronavirus
BBC - Latin American crime gangs adapt to pandemic
Foreign Affairs - The Pandemic Could Bring Power to Latin America’s Criminal Gangs
InSight Crime - Theft of Critical Medical Equipment Surges in Latin America
The Guardian - Lockdowns leave poor Latin Americans with impossible choice: stay home or feed families
Washington Post - Stirrings of unrest around the world could portend turmoil as economies collapse
NYT - ‘This Government is Lucky’: Coronavirus Quiets Global Protest Movements
NYT - Oil Collapse and Covid-19 Create Toxic Geopolitical Stew
NYT - Amid Covid-19, China Ups Its Game in Latin America
WSJ - Coronavirus Pandemic Prompts Race in Latin America to Build Cheaper Ventilators
Bloomberg - Puerto Rico 2.0? Wall Street Warns of Caribbean Debt Crises
NYT - Covid-19 Trickles Into Haiti: ‘This Monster Is Coming Our Way’
Reuters - Brazil's Rio at mercy of Pimco, Dodge & Cox as oil cash dries up
WSJ - Amazon Deforestation Accelerates as Coronavirus Pandemic Hinders Enforcement
Reuters - As Amazon fire season looms, smoke and coronavirus could be 'a disaster'
DFR Lab - How Bolsonaro’s disinfo machine targeted Brazil’s pro-quarantine health minister
FT - Chile’s coronavirus outbreak helps revive Piñera’s fortunes
Washington Post - Chile’s ‘immunity passport’ will allow recovered coronavirus patients to break free from lockdown, get back to work
BBC - Chile lockdown: Anti-government protest broken up by police
WSJ - Senior Mexican Health Official Questions How Deadly Coronavirus Really Is
The Guardian - Mexican criminal groups see Covid-19 crisis as opportunity to gain more power
Global Initiative Against Organized Crime - Organized crime, trafficking in persons and deforestation in Chihuahua, Mexico
Animal Politico - Opacidad, simulación y dudosa eficacia: la Guardia Nacional a un año de su creación
Reuters - 'A failure foretold': Mexican president's business brawl gets political
AP - US pressures Mexico to reopen plants amid worker walkouts
The Guardian - Peru: riot police block highway as people attempt to flee amid lockdown
Thanks for reading
By my count, it’s day 35 of quarantine here in Bogota. Thanks to everyone for reading while most of us are stuck inside somewhere. Please feel free to forward this to your colleagues and encourage them to sign up for the free weekly newsletter at https://boz.substack.com